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Sponsored by River City Company
March 26, 2013
The Value of Downtown Per Acre
The Value of Downtown Per Acre

Many would agree that Downtown Chattanooga is a valuable asset to the community. From the development and use of the Riverfront to the booming Southside renaissance, downtown is the epicenter of our region. However, how can we monetize downtown’s worth? What calculations are available to quantify the sometimes subjective idea of value?

 

One can calculate downtown and outlying areas on a “per acre” basis similarly to how we evaluate the mileage of a car on miles per gallon. Looking at an acre of property in terms of cost and yield, one can clearly conceptualize how utilizing downtown’s assets is much more profitable and efficient versus development expenditures outside the city’s core.

 

For instance, 2.4 acres of the North Shore Condos Building equals the entire property tax yield that is produced from the 67.2 acres of Hamilton Place Mall. That means that the North Shore Condos are 28 times as potent with their property tax yield as Hamilton Place Mall. Another example, 2.6 acres of the Cherry Street Townhomes equal the entire property tax production of the 67 acre Eastgate Mall.

 

Currently, downtown properties on average are producing $44,000 per acre in property taxes. With renovation of upper floors of downtown buildings that only adequately utilize first floor space into occupied residential or office space, the property tax production could yield close to $80,000 per acre. By comparison, Hamilton Place Mall is only currently producing $16,500 per acre in Chattanooga taxes.

 

To read more about the Value of Downtown Chattanooga, please read the full report here.